I have done a little more research into the area I am looking at and have the following information.
Constructing a 10’6"x36’ will cost me a little under $40,000 installed. Have an actual quote.
Contacted Lamar about their rates on those size signs even though they were listing them for $2,100 month, they have a special where they are charging $1,500/month for 5 signs, so basically $500/month. Realizing if you only did one face it would be higher, maybe $800-$1,000
Contacted another company that has about 4 signs in the area I am looking at and they charge $700/month. They currently have half of their faces vacant.
Both charge about $800 for printing the vinyl and installing.
At this point I would be guessing to say I would pay no more than $600/yr for land lease plus at most 15% of revenue.
With a note of $40,000 for 10 years at 8% gives me a payment of $335 month. Figuring 70% average occupancy, this would be one side rented 100% and the other side 50% for the year, less around $4,000 annually for property taxes, electricity, income tax, and insurance would be a whopping $1,000 profit annually. This is with financing 100%. If I put $8,000 (20%), annual profit after taxes of $1,700, ROE 21.3%, CAP 13.7%. Of course this does not take into account the hours that I would work and what the hourly pay rate would be.
Before I spend anymore time or money on this I am looking for some feedback to see if I am looking at something incorrectly, or if I should give up on this area.
Thanks again for the help.